Major gaming firms saw their share prices take a tumble at the weekend after Google unleashed its latest AI platform that promises to transform simple text prompts into playable worlds.

GTA developer Take Two Interactive saw its price slip by 10%, while Roblox experienced a 12% dip and Polish studio CD Projekt RED saw its stock price fall by 8.00%, all fairly minimal compared to the 21% drop suffered by Unity Software, a video game engine and development platform.

Investors were rattled by Google’s first‑phase rollout of its Project Genie general‑purpose world model, a prototype web app powered by Genie 3, Nano Banana Pro and Gemini, which can create interactive and immersive environments using a “World Sketching” technique.

While currently only available to select US users, the platform can create a navigable world, with Google’s Genie 3 generating a path ahead in real time, as well as simulating physics defined by user prompts. 

Not only that, the system allows users to create their own characters to populate their world, with the system allowing a choice of first-person or third-person perspectives.

While Google framed Genie 3 as a boon for robotics and research, it’s little surprise that game studios and their investors view this latest leap in AI with anxiety, even if generations are currently being limited to sixty seconds.

Even in its infancy, Google’s tool is evidence of AI’s power to speed up lengthy development cycles and strip out major costs, issues which have continually delayed the release of the latest GTA.

Looking to calm the markets, Unity’s CEO Matthew Bromberg took to X, writing that rather than seeing AI world-building as a risk, the company considers it a “powerful accelerator”.

“Video-based generation is exactly the type of input our Agentic AI workflows are designed to leverage—translating rich visual output into initial game scenes that can then be refined with the deterministic systems Unity developers use today,” said Bromberg.

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“Our agents already generate high-quality scenes from static video. Interactive, camera-controllable video from world models would further enhance this pipeline and materially improve the fidelity and speed of early-stage content creation. 

“We believe this represents a meaningful step forward for AI-driven development across the industry.”